Merryn Talks Money Magnificent 7 Stocks Slip Into Correction, Bitcoin Dips and Trump's "Gold Card" Idea
Feb 26, 2025
John Stepek, a senior reporter and writer of the Money Distilled newsletter, dives into the recent downturn of the Magnificent 7 tech stocks, which led to a correction after a stellar rise. He discusses Bitcoin's volatility and its positioning as a speculative asset, shedding light on the tensions between traditional investments and crypto. The conversation also touches on Donald Trump's controversial 'gold card' proposal for fast-tracking U.S. citizenship through investment, exploring its implications in the current economic climate.
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Shifting Momentum in US and European Stocks
- US tech stocks, especially mega-cap tech, have seen a shift in momentum.
- European stocks are rising while American stocks, particularly the "Magnificent Seven," have entered correction territory.
European Bank Stocks on the Rise
- European bank stocks, a previously detested sector, have been performing well, mirroring a trend seen after the dot-com bubble.
- This suggests a market shift where "dejected stuff" is being picked up, with momentum currently favoring European banks.
US Market Overvaluation
- The US stock market is significantly overvalued compared to its historical median across various metrics.
- Cheaper markets, while not necessarily cheap in absolute terms, are relatively attractive and poised to outperform in the long run.